The Silver State had the country's highest foreclosure rate for the ninth consecutive month in September, with one filing for every 185 households. The rate was even higher in the Las Vegas Valley, with one for every 150 households. That's ninth among major cities.

Monthly single-family home sales are falling dramatically against a staggering inventory of unsold properties. Yet prices have not dropped nearly so much.

Is that a buyer's market? If not, when will it become one?

It's no surprise that despite all the hemorrhaging, professionals who have a hand in the local real estate industry, and even some amateur investors, say now is a prime time to purchase a home.

It's not all hype. The Multiple Listing Service has more than 30,000 single-family homes, condos and townhouses for sale in the Las Vegas Valley.

Rick Brenkus, co-owner of two local Keller Williams Realty offices, sees uncertainty in both buyers and sellers sitting on the sidelines, holding out for a better deal.

Some potential buyers think this 18-month inventory of homes warrants a 20- to 30-percent price plunge, he said.

Meanwhile, some would-be sellers are fixated on capturing sale prices more in line with the earlier red-hot housing boom than with today's market.

"If you bought a home four years ago for $160,000 and six months or a year ago it was worth $350,000, and today you can sell it for $300,000, did you really lose anything or did you actually gain $140,000?" Brenkus asked.

Timing the market to swoop in on rock-bottom prices might require more luck than skill, but there are some educated estimates.

According to a recent analysis by Moody's Economy.com, Las Vegas single-family home prices will bottom out in the fourth quarter of 2008. By then, prices are expected to drop an estimated 18.7 percent from their peak in the second quarter of 2006.

That's the 10th-greatest decline, by percentage, predicted among the nation's 100 most populated cities.

Moody's forecast declines in more than 75 percent of the nation's 379 largest housing markets over the next few years, for an average drop of 7.7 percent.

Also weighing in is Robert Shiller, a Yale University professor and a leading housing economist. In a congressional committee hearing on the subprime lending crisis last month, he said that home prices nationwide are expected to fall at least 7 percent on average next year.

Real home value has already fallen 6.5 percent since early 2006, when prices peaked, he said. On an inflation-adjusted basis, home value rose 86 percent from 1998 to early 2006.

According to the Case-Shiller price index, which tracks multiple sales of the same homes in 20 cities, Las Vegas had a 6.1 percent decline in July compared to a year earlier.

Because the U.S. housing market is valued at about $23 trillion, Shiller said, the real loss of home value is estimated to reach trillions of dollars by August 2008.

"I believe that this loss in housing value is the major ultimate reason we see a crisis today," he told the Joint Economic Committee.

And if history is any guide, it strongly signals a recession next year.

"Declines in residential investment have been an important factor in virtually all recessions since 1950," Shiller said. "The last time we saw such declines, in 1990-91, there was a U.S. and worldwide recession, of rather short duration, but followed by a weak economy for several years. The housing boom since the late 1990s was clearly bigger than the one that preceded the 1990-91 recession, and the contraction in residential investment since last year is sharper.

"I am worried that the collapse of home prices might turn out to be the most severe since the Great Depression."

In an appearance on NBC's "Today Show" three weeks ago, Jim Cramer of CNBC's "Mad Money" show emphatically advised against investing in residential real estate.

"Don't you dare buy a home right now. You will lose money," he warned.

But blanket statements such as that don't take into account how intensely local real estate markets are.

Not every market is seeing home prices fall. Value is expected to appreciate in some relatively affordable areas that missed out on the housing bubble, according to Business 2.0. The magazine, working with Moody's, recently identified 10 major cities where home prices are forecast to rise over the next two years.

The Dallas-Fort Worth area tops the list of mostly Southern cities; Indianapolis and St. Louis also are named.

Even in Las Vegas, with its high foreclosure rate and inventory glut, there are classes of homes, such as those priced upward of $1 million, that so far remain relatively immune to the current real estate woes.

LOOKING TO JOB GROWTH

Many real estate professionals say they are banking on the area's growth in population and jobs to restore some equilibrium to the market.

Some maintain the "correction" will occur here sooner than in other areas of country simply because signs of trouble surfaced here earlier.

But first things first.

"You have to get rid of that inventory before any real recovery can take place," said Dennis Smith of Home Builders Research in his Sept. 15 housing market letter.

Yet at some auctions lenders have been unwilling to discount foreclosed properties more than 20 percent or 25 percent from listed prices, he wrote.

But Guy Deiro, president of a local real estate brokerage, auction and liquidation company that bears his name, said he recently has seen more lenders and individual sellers willing to compromise. In the past month, he said, about 80 percent of the sellers accepted final bids at his auctions.

"Lenders are starting to figure it out, what the story is in terms of where they have to go down to," Deiro said. "As the month goes on, everyone seems to get more realistic."

Smith suggested lenders follow the example of home builders that have aggressively unloaded their inventory and move on.

At least one builder took action about a year ago, when the real estate market showed signs of slowing.

"We changed the policy," said Richard Dix, Mountain West area president for Pulte Homes/Del Webb. Now the company starts building only when it has a signed contract to sell the house. "The only real inventory we have is when something falls out of contract."

Tom McCormick, president of Las Vegas-based Astoria Homes, says he thinks more builders will follow suit.

"It took us a long time to work off the extra homes, and we are not going to start building a bunch of homes until buyers walk in."

The new home market has a much leaner inventory than the resale home market -- about one to two months' worth -- McCormick said. Area builders sold 1,970 new homes in August, about double the number of building permits issued that month.

Presold properties have long been a mainstay for Astoria Homes. Nonetheless, the company was caught off guard when it lost about 25 percent of its buyers because of the subprime crisis.

"These are people who had bought from us and told us they had a loan, and the lender went broke, so the buyer never closed," McCormick said. "That is why we had a sudden burst of inventory."

Astoria Homes bolstered its financing promotions with other incentives, including lot premiums, customized upgrades and discounts that created savings upward of 15 percent off the sales price, he said.

The builder expects to sell its remaining homes, which totaled about 60 early this month, by the end of the year.

PLAYING THE BLAME GAME

When it comes to assigning blame for the mortgage mess, fingers point at everyone from the borrowers and mortgage brokers to the lenders and Wall Street.

Investors, too, have been faulted for escalating prices with their speculative deals. Some of the flippers, who previously turned properties at heady profits, have changed tactics. They are still in the game, but as landlords of properties that they buy and turn into rentals.

The last housing boom was fueled by buyers believing that prices would only continue to rise and lenders who were only too happy to finance their dreams. Shiller, the housing economist, noted that booms produce excesses, such as the decline in lending standards that generated the crisis of subprime loans, which are obtained by people with weak credit.

Millions of subprime borrowers who took out adjustable-rate mortgages in the past two years will be hit with much higher payments this year and next.

But the fallout on the U.S. economy extends beyond the subprimers, Shiller said.

Mortgages tend to default and result in foreclosure after home prices fall because people who buy high see their homes becoming worth less than the amount they owe, he said. They anticipate more price drops and lose motivation to keep making payments.

Price declines also make it harder for homeowners to tap their home equity or refinance their mortgages.

FED RATE CUT APPLAUDED

Wall Street cheered when the Federal Reserve slashed half a percentage point from the federal funds rate, which is the interest rate banks charge other banks.

Cutting the funds rate, which affects credit cards and home equity lines of credit, was intended to ease credit pains related to the mortgage meltdown. But it might provide more of a psychological boost to consumer confidence than a tonic for the ailing housing market.

The Greater Las Vegas Association of Realtors reported 990 single-family home sales in September, down 24.8 percent from the previous month and down 43.1 percent from September 2006. These homes were posted on the Multiple Listing Service, which doesn't necessarily include sales by local builders and transactions not involving a Realtor.

Realtors reported that the median home price was $285,750 last month, down 4.7 percent from August and down 7.8 percent from September a year ago.

Wouldn't a buyer's market call for a steeper price drop?

"Buyers are more likely to make a full-price offer on a home that they perceive as being priced competitive, rather than make a low offer on a home that they perceive as being overpriced," Brenkus said.

Most of the homes are selling within 1 percent or 2 percent of the asking price, he said. Nearly 50 percent sell within two months of being listed. Moving the fastest, he said, are those priced at more than $1 million and less than $250,000.

As a sign of the times, Brenkus, with 22 years in the business, estimates that 20 percent of the properties his offices handles are foreclosures or short sales, up from about 7 percent a year ago.

In short sales, the lender accepts proceeds from a house sale, even though the amount falls short of what is owed on the mortgage.

Jeremy Aguero, principal of Applied Analysis, an economic research firm in Las Vegas, said he expects the residential real estate market to hit bottom and begin working its way out by the second or third quarter of next year.

By then, he said, the area will start benefiting from the many commercial projects coming on line and the workers they will require, who also can help absorb the housing inventory.

"We are not talking about being in a recovered state in late 2008," Aguero cautioned.

"We need a taking down of the standing inventory, most notably the resale inventory, a flushing through of the investor overage that we currently have in the market, and we really need to see the subprime issue show significant signs of alleviating."